China shares track overnight Wall Street slump on recovery concerns

China stocks fell on Thursday, with energy and technology firms leading losses, following a slump on Wall Street overnight on renewed concerns over slowing global economic recovery due to resurgence of coronavirus cases.

At the midday break, the Shanghai Composite index was down 1.46 per cent at 3,231.79. China's blue-chip CSI300 index was down 1.63 per cent, with its financial sector sub-index lower by 0.96 per cent, the consumer staples sector down 1.35 per cent, the real estate index down 1.44 per cent and the healthcare sub-index down 1.71 per cent. Chinese H-shares listed in Hong Kong fell 1.78 per cent to 9,388.91, while the Hang Seng Index was down 1.78 per cent at 23,319.54, hitting the lowest level in nearly four months. All but two index constituents fell.

The energy sector sub-index in Hong Kong shed 2.5 per cent while the CSI Information Technology Index lost 1.9 per cent.

The smaller Shenzhen index was down 2.06 per cent, the start-up board ChiNext Composite index was weaker by 2.12 per cent and Shanghai's tech-focused STAR50 index was down 0.87 per cent​.

"The toing and froing pandemic overseas is delaying recovery in US, leading to the market slumps," said Zhang Yanbing, an analyst with Zheshang Securities. "While the downward trend in mainland A-shares will be limited as China is achieving a better recovery."

Federal Reserve Vice Chair Richard Clarida said on Wednesday that the US economy remains in a "deep hole" of joblessness and weak demand, and called for more fiscal stimulus, noting that policymakers "are not even going to begin thinking" about raising interest rates until inflation hits 2 per cent.

China's cabinet said it will allow more qualified foreign investors to make strategic investment in Chinese listed companies, state television reported. Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.04 per cent while Japan's Nikkei index was down 0.79 per cent.

The yuan was quoted at 6.8168 per US dollar, 0.11 per cent weaker than the previous close of 6.809.